The Central Bank of Cuba (BCC) implemented its most significant daily exchange rate increase since the introduction of its “exchange segments” system on Tuesday, in an effort to align more closely with the actual value of foreign currencies in the market.
The official dollar rate climbed from 419 to 426 Cuban pesos (CUP), marking a rise of 7 pesos, while the euro saw an increase from 485.87 to 496.12 CUP, a gain of 10.25 pesos.
Nevertheless, this adjustment does not alter the underlying situation. The informal market continues to dictate its own terms: there, the dollar remains at 490 CUP and the euro at 530 CUP, according to data released by elTOQUE on Tuesday.
The gap between these rates remains vast: 64 pesos for the dollar and 34 for the euro, underscoring that the BCC’s so-called “floating rate” only floats on paper.
The Largest Leap... Yet Still Lacking
The increase on Tuesday represents the steepest jump since the Cuban regime launched its new monetary framework in December, a strategy that promised to mirror the “market supply and demand” but has so far demonstrated a slow, controlled movement without practical impact.
Experts consulted by CiberCuba agree that this latest increase aims to signal adjustments in response to pressure from the informal market and public criticism, while avoiding the political costs of a deeper devaluation.
Two Divergent Economies
As the Central Bank announces its “current day operation” rate, Cubans continue to purchase foreign currency on the streets at significantly higher prices.
The disparity between official figures and the real economy not only highlights a monetary gap but also indicates a fundamental loss of trust.
Today’s leap is, simultaneously, an implicit acknowledgment: the BCC does not set the dollar's price; it merely chases it.
Understanding the Exchange Rate Disparity in Cuba
Why did the Central Bank of Cuba increase the exchange rate?
The Central Bank raised the exchange rate to better align with the real market values, responding to pressures from the informal market and public criticism.
What are the current differences between the official and informal market rates?
The official rate for the dollar is 426 CUP, while the informal market maintains it at 490 CUP. Similarly, the euro is officially at 496.12 CUP compared to 530 CUP on the street.
How does the BCC's "floating rate" system work in practice?
Although designed to reflect market supply and demand, the "floating rate" has shown limited movement, causing it to trail behind the dynamic informal market rates.